Caltrans considers management change for 710 properties

Caltrans has hired a consultant to assess the costs and benefits of three options to shift the management of a set of state-owned properties in the path of the 710 Freeway extension.

The change comes in response to a state audit ordered by Assemblyman Anthony Portantino, D-Pasadena, and released in August that slammed the agency for "poor management" of the more than 500 properties it purchased decades ago to make way for a surface freeway from El Sereno to Pasadena.

In a required 60-day update Caltrans sent to the State Auditor's office last month, the agency said it is considering hiring a private vendor to manage the properties, transferring them to a local transportation agency or creating a managing Joint Powers Authority with South Pasadena, Pasadena and Los Angeles.

The Metropolitan Transportation Authority is in the first phase of its three-year EIR, and has delineated five final options to close the 710 gap that do not include a surface freeway, meaning many of the properties may no longer be needed to complete the project.

Caltrans spokeswoman Lauren Wonder said the agency had its first meeting with the consultant in October.

"At the October meeting, we discussed the need to conduct an independent cost-benefit analysis of the property management alternatives for the State Route 710 homes," Wonder said. "It is important that this analysis is comprehensive, objective, clear and transparent."

Portantino said he was disappointed that the agency was not considering selling the homes back into private ownership.

"To me that's the biggest thing that jumps out is it doesn't talk about getting the state completely and totally out of the real estate business," Portantino said. "So I will be encouraging them in my follow-up to put more emphasis on selling the homes and less emphasis on creating bureaucracy."

But Caltrans' said in its 60-day update it has take other steps to respond to the audit's 10 recommendations to prevent a recurrence of the $22 million revenue loss it estimates Caltrans' "poor management" cost the state from 2007-2011.

Wonder said the agency has already made "significant progress" on the auditor's recommendations, including stopping its overspending and lack of oversight on property maintenance and verifying affordable housing eligibility.

"We've already finished the property inspections to identify any maintenance concerns and are working with the tenants on verifying income eligibility as we look at the affordable rent program," Wonder said.

The agency is also addressing the below-market rent rates the audit exposed, and has notified tenants that their rent may increase this March, according to the 60-day report.

South Pasadena City Manager Sergio Gonzalez said it seems that Caltrans is taking steps to improve its relationship with tenants, but that there is still a long way to go.

"While this continues to be a long, drawn out process and response, we still have people living in conditions that are deplorable," Gonzalez said. "I attended a meeting about a month and half ago with local tenants and Caltrans, and I think the communication is better but to get responses from Caltrans and get repairs done in a timely manner continues to be a struggle by many tenants."

Portantino said although the 60-day update is "very preliminary," he has faith that Caltrans will work to make significant changes in its property management practices.

"The whole purpose of the audit is to get good management practices into a corridor that desperately needs them," Portantino said. "We want to make sure the final policies reflect the serious nature of the concerns and I'm willing to give them the benefit of the doubt that they are working toward that."

Portantino said he plans to meet with Caltrans representatives before he leaves office in a few weeks. Caltrans will submit another progress report in February, and the State Auditor will give the state legislature a progress report in August.